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Monday, October 10, 2011

Can Korea be Truly Creative? It Already Is.

The passing of Steve Jobs last week prompted a worldwide reflection of the incredible life and achievements of Jobs. Koreans joined in the reflection, filling online channels with tributes to and quotes from Jobs. For Koreans, however, the tributes to Jobs were not simply about the celebration of Jobs' legacy. Around the globe, and certainly in Korea, Steve Jobs has come to embody the concept of creativity itself, particularly in the context of modern economy. Therefore, Jobs' passing provided a moment of self-reflection about the frequent criticism of Korea, brought up by Koreans and Korea-observers alike: although Korean economy generates cutting-edge technological products, it is not truly creative like Apple, led by Jobs, is. Korea's hagiography of Steve Jobs following his death, in a large part, is a hagiography of creativity that it considers lacking.

I do not think it is healthy for Koreans to engage in such hagiography, for three reasons: (1) creativity is not, and must not be, the ultimate goal of a national economy; (2) creativity, depending on its type, can be vastly overrated and underrated at the same time; (3) creativity was not the only reason, or even the most dominant reason, why Apple and Steve Jobs were able to build their amazing achievement.

In making these points, not for a second am I discounting the importance of creativity in a national economy. Creativity is one of the most important traits in human life. It is the driver that brings us the products that make people's lives easier, fuller, better. Apple is a wonderfully creative company because it has been able to envision such products better than any other company in the world. Only an idiot would dismiss the role of Jobs in making a moribund company (Apple in mid-1990s,) as well as himself, into a cultural icon. My points are only that Koreans' obsession with creativity is unhelpful, and that Apple is not a good model for Korean companies to emulate.

In elevating creativity to an end itself, economic observers tend to lose sight of the ultimate goal for a national economy: wealth and jobs. A national economy is supposed to generate wealth, and create jobs such that the wealth can be shared among citizens in exchange for labor. There is no "creativity scoreboard" by which various national economies make notches. Creativity is important, but is not an end to itself. The importance of creativity is no more than the extent to which it contributes to the creation of wealth and jobs.

Based on the decade-plus experience of "creativity-led" economy, the evidence appears strong that although creativity is great for generating wealth, it does poorly in generating jobs. This figure alone speaks volumes: Apple, Google, Facebook and Amazon collectively employ just 113,000 people, a third of GM’s payroll in 1980. Similarly, Samsung Electronics, LG Display and LG Electronics -- the leaders of Korean electronics -- collectively employ nearly 300,000 people, in a country whose population is less than 1/6 of America's.

Apple, Google, Facebook and Amazon are certainly much more valuable collectively than Samsung Electronics, LG Display and LG Electronics -- to be precise, more than five times as valuable based on estimated market values. But consider this -- although Apple's market value is around 2.5 times of Samsung Electronic's market value (around $330 billion versus around $138 billion,) Samsung Electronics employs nearly four times more employees than Apple (around 188,000 versus around 49,000.) For more -- ahem -- apples-to-apples comparison in terms of market value, Google's market value is approximately 25% greater than Samsung Electronics, but Samsung Electronics employs more than six times of the number of Google employees. And the reason for this is obvious: Samsung Electronics focuses heavily on "uncreative," labor-intensive (but high-grade) manufacturing, while Apple and Google focuses on the "creative" endeavors and farm out the actual production.

("creative" and "uncreative" are in quotes because, as described further below, manufacturing in fact is plenty creative. The designation here is more about perception, not about whether or not there is actual creativity involved.)

If you were in charge of a national economy, would you rather have 20 companies like Google, or 20 companies like Samsung? The answer is not obvious, and will depend on what you value more. There may be perfectly good reasons to choose 20 Googles over 20 Samsungs. But choosing 20 Googles comes with an inevitable conclusion -- your national economy will generate 25% more wealth, which will be distributed to 1/6 of the number of people. To a severe degree, wealth will be concentrated on the top. For a national economy with 20 Googles to achieve a similar level of distribution as the one with 20 Samsungs, the taxation at the top bracket will have to be so drastic that the people who do make money through Google will revolt.

Of course, there may be a business model in the future that finds a happy medium of creativity that leads to job creation. However, by now we do know from experience that although creativity-centered economy may generate fabulous amount of wealth, it does not generate enough jobs for a populous country like U.S. or Korea. If one cares about income polarization and hollowing of the middle class, one must also care about focusing excessively on creativity in the economic theater.

What Kind of Creativity?

There should be no doubt that Apple is a wonderfully creative company. But at the same time, Apple's creativity is wildly overrated. Similarly, Steve Jobs deserves to be praised for his creativity. But at the same time, many other people who deserve the equal amount of praise for their creativity receive not a fraction of the attention received by Jobs. Why does this happen? It happens because people consistently overrate the tangible things that are understandable and close to their lives. Again, no one is denying that Apple's products demonstrate fantastic creativity. But their creativity is praised in large part because the products are tangible, understandable and close to people's lives.

Take a look at this article, for example, which explains out Samsung is able to keep up with Apple even though Galaxy S does not create a psychotic fan base like iPhone. (By the way, the writer of that article is an unabashed Apple fan who wrote two Korean language biographies of Steve Jobs.) Essentially, Samsung's production line has an extremely fast reaction time to precisely caliberate the amount of production based on consumer response. If Galaxy S sells well, Samsung can instantly double its production by an efficient and innovative use of its manufacturing lineup, which includes machinery as well as its employees. If it does not, Samsung can quickly change the production into a different product with little down time. Coming up with this type of production line undoubtedly takes creativity. But have you ever read a hagiography of how creative Samsung is for coming up with this system? Me either.

Here is another example. Korea is the world's leader in shipbuilding, based on the ships' monetary value. (Korea is second to China in terms of the ships' tonnage.) The three largest shipbuilding companies of the world are Korean. Entire Europe produces less than one-tenth of the ships that Korea produces. And it is not the case that Korea manages to do this by leveraging cheap labor. Korea's shipbuilding companies are notoriously well-unionized, and their employees are paid well enough such that Ulsan, the base city for Hyundai Heavy Industries, has the highest average income among all Korean cities, doubling the national average income. Korea's competitiveness arises from the fact that it delivers high quality and innovative ships -- for example, a new container ship from Daewoo Heavy Industries that reduced carbon emission by half while carrying even greater number of containers. Have you ever heard or read a praise of creativity for Daewoo Heavy Industries? You are lying if you said yes.

One can argue forever about whether the creativity it takes to build an iPod is greater or lesser than the creativity displayed in above examples. But this much is certain: in all of the examples above, there is a great degree of creativity involved. And no one hears about how creative they are, because one cannot hold a manufacturing process in one's hands, and rarely does one see a highly sophisticated ship that nonetheless plays an integral role in a modern consumer's life. Creativity displayed in a tangible, visible household product will always be overrated because it is constantly available. (This is the same reason why I previously wrote that Korea's economy is slightly overhyped.)

This then goes back to the point about the national economy. Creativity deployed in a manufacturing process or in a less-than-sparkling product like container ships generates wealth and jobs just as well as creativity deployed in shiny consumer electronics. Then does it make sense to fixate on the creativity involved in making shiny consumer electronics while understating the creativity involved in logistics and other manufacturing -- particularly given that manufacturing creates a lot more jobs? When a national economy already features world-leading corporations, does it make sense to shift the creative focus away from those industries?

Real Reason Why Apple is Successful -- It's not Creativity

At this point, one can make a forceful counterpoint in favor of Apple-style creativity. One could argue:

"While TK's examples certain involve creativity, Apple's creativity nonetheless stands out because Apple's creativity generated not simply a new product, but a new trend. Instead of fighting in a defined arena, Apple was able to open up a vast new territory with its creativity. Apple's creativity is proactive; others', reactive. Apple fundamentally changed people's consumption patterns; other companies like Samsung could only follow the change. Being reactive is always easier than being proactive, and therefore your position is always more precarious. Take a look at Sony, for example. Although Sony was innovative in its own right, it never redefined the game like Apple did. Sure enough, Samsung was able to catch up to Sony and now exceeds in many areas, e.g. flat panel televisions. Sooner or later, there will be another company to supplant Samsung's place, but by then Apple (or other companies that think like Apple) will have opened up a new frontier."

This is a strong counterpoint, because it is in large part true. Apple as a company opened up new frontiers like few other companies did. But this counter-argument fails because of one critical error: it thinks that Apple opened up new frontiers because it was creative.

Here is an easy example that shows the reason why Apple's real strength was not creativity. Take iPod, for example -- the device that served as a harbinger for Apple's current dominance. There is no question that iPod was a creative, innovative product. Its design was attractive and its user interface easy and intuitive. So, if you are old enough to remember, suppose you are back in 2001. Also suppose that the first iPod equivalent -- known as yPod -- was made by a company called Mela, based in Italy, instead of Apple based in Cupertino, California (which, in this alternate universe, would continue to only make computers.) Mela's yPod is identical to Apple's iPod -- it is small, sleek, modern and easy to use. Mela also has yTunes store, through which all of the latest Italian music will be available to be purchased and downloaded directly into yPod, just like the iTunes store in real life.

Would yPod be nearly as successful as Apple's iPod? Not a chance. But why not? Everything about yPod is the same as iPod. It took exactly the same amount of creativity to produce yPod/yTunes as to produce iPod/iTunes. Then what is the difference? The difference is plain -- far fewer people of the world care about Italian music compared to American one. The ability to conveniently download music -- iPod's greatest strength -- means significantly less if the music is not American.

Here, we get a glimpse of Apple's true strength. The reason why Apple can remake the world's consumption habits is not because Apple is creative. Apple can be remake the world's consumption habits because Apple is American. And American companies can remake the world's consumption habits because America is a superpower. Writ large, the greatest strength of American economy is not its creativity; the greatest strength of American economy is that America is a superpower.

One trait of Americans that constantly amuses me is that Americans -- even the really bright ones -- have very little idea of what it means to be a superpower. Being a superpower means that America gets to make the world in its image. Being a superpower means the rest of the world aspires to live like Americans, dress like Americans, eat like Americans and think like Americans. Sure, there will be small areas in which other countries could set the trend. European fashion designers still have their sway, and Japanese animators and game makers have their sphere of influence. Each country will keep its food for the most part, because food is one of the most intimate elements of a culture. But when it comes to the larger frameworks of life -- democratic regime, capitalist economy, consumerist society, cars, fast food, professional sports, pop culture, hiphop -- people of the world either live, or aspire to live, like Americans. THAT's what it means to be a superpower.

(Aside 1: In an interview I gave recently, the interviewer asked if there is anything in American culture which causes Koreans to automatically recoil in revulsion, like the way Americans do with Korea's dog meat. I had to suppress a chuckle at the naivete of the premise -- as if America and Korea occupy the same space in world hegemony! In fact, Korea's anti-dog meat movement is the prime example of how America's influence as a superpower could arbitrarily reverse a beloved, millennia-old traditions like dog eating.)

(Aside 2: The last meaningful challenger to America's hegemony was Soviet Russia, which -- if you took its narrative seriously -- sought to reshape the world according to its ideals of communism and populate it with the New Soviet Men. Although much ink is spilled on China's rise as a new superpower, China will not be a superpower like the way America is, or even the way Soviet Russia was, in the near future. As formidable as China's military might and economic strength are, it will take at least a century before anyone will want to live like the Chinese.)

Although iPod/yPod was the easiest example, the same logic can apply to almost all of the famous Apple products. Apple's products were not successful because of their creativity -- or, stated more precisely, the success of Apple's products depended on much more than their creativity. Apple's creativity had the ability to change the world because America has the ability to change the world. In fact, the same applies to nearly all innovative American products. More than anything else, American creativity works because it fits American sensibilities the best, and the rest of the world either lives like America or wants to live like America.

(Aside 3: Some might point to economic nationalism, prevalent in East Asia, that causes the Chinese to "buy China," for example. However, the strength of economic nationalism in brand loyalty is very much overstated -- exemplified by this article that highlights how Li Ning, China's largest domestic athletic gear company, is losing grounds to Nike and Adidas in the domestic market.)

Take Facebook, for example. Facebook is definitely an innovative product. But five years before Facebook, Korea had Cyworld -- a social networking service before anyone in the English-speaking world has even heard of the term "Social Networking Services." And Cyworld became extremely popular in Korea, just like the way Facebook is now. At its peak, Cyworld had more than 17 million members, an incredible figure given that the population of Korea is around 48 million. But although Cyworld attempted to expand beyond Korea, it failed to make a global impression for one simple reason: it was optimized for Korean sensibilities and environment. Cyworld's design was too "cute," and it had many design elements that were compatible with Korea's blazing fast Internet but clunky with slower Internet elsewhere in the world. Now, Facebook may have overtaken Cyworld as the leading social networking site in Korea, and that is not because Facebook is functionally so much better than Cyworld.

So here, we can see it is particularly dangerous for Korean economy to attempt to become "truly creative" like Apple. Such attempt is based on the false idea that as long as Korea can get more creative somehow, it will be able to open up new frontiers in consumer culture like Apple has done. Unfortunately, that is simply not true. People of the world don't want to live like Koreans; they want to live like Americans. No matter how much creative Koreans try, they cannot envision a better fit to an American life than creative Americans.

What is Korea supposed to do then? I submit that a much better model for Koreans to follow is not America, but Germany. Germany of today is not a superpower like America is. In fact, in terms of soft power, Korea may already be somewhat close to Germany: as much respect as Germany's renowned philosophers deserve, one does not hear too often glowing praises about Germany's contemporary movies or pop music. Germany, like all countries in the world except America, operates within an American framework. But Germany does what it does well incredibly well. It focuses on manufactured products that do not require too much cultural translation -- e.g. automobiles, optical lenses, and sophisticated business-to-business equipments. Leading German corporations like BMW, Leica and Siemens are most certainly creative. Consequently, German economy achieves its goal as a national economy very well. Germany is a wealthy country, and its wealth is distributed widely through jobs. Even in the midst of global economic crisis, Germany's unemployment rate is at admirable 6.1% as of December 2010. And all this happened without needing any path-breaking company like Apple.

Conclusion: Can Korea be Truly Creative?

So, let us finally address that persistent question: can Korea be truly creative?

Please -- Korea is truly creative already. Korean economy today is an ipso facto proof of Korea's creativity, because it is simply not possible to have an economy like Korea without being creative. Steve Jobs may have been a visionary, but so was Chung Joo-Young, the swashbuckling founder of Hyundai who had the cojones to walk in with a meeting with Barclays Bank with little more than a picture of an empty beach in Ulsan, and demanded to borrow the money to build a shipyard on that beach. iPhone may be innovative, but so are the numerous components make iPhone what it is -- the Retina display, applications processor, DRAM memory and Flash memory, all built by either LG or Samsung.

Korean economy certainly should be more creative, more daring and more visionary. That is the only way for it to survive and thrive. But Korea's inability to produce a company that changes the game, like Apple has done, is hardly a knock on Korea's creativity. A lion has its own way of surviving, and so does a fox. America may thrive with Apple, but that road is not for Korea.

33 comments:

Wrote myself today, similarly inspired by the discussions following Job's death, and while I took a different slant, I wound up fairly wordy on the topic as well. To summarize, as an outside observer I don't feel the social structures of Korea are really designed to fit the 'innovator' mold buzz that many are touting as necessary, but is it really necessary? Probably not.

While I agree with your sentiments regarding the supposed "creative" economy, I must disagree with you on your analysis of Apple and Sony. To start, Sony did redefine the game and at its height was considered the same sort of innovative company that Apple is today (sans messianic pitchman). It's innovations, particularly with the Walkman, completely upended the consumer electronics market and established itself heads above others with people looking toward it for the next great market innovation. The fact that their brand reputation held for so long despite their steady decline in quality is a testament to its strength and its peak.

As for Apple, I think you miss what made the the iPod and later the iPhone so unique. Yes, the fact that it was a symbol of American culture certainly helped with its appeal and attraction, and once it established its position in the US market, that label helped sell the product overseas. However, when the first iPod came out, it was a time when Japanese products were considered near untouchable. No one took American consumer electronics products seriously even in the United States, and Japanese brands like Sony were what commanded the global premium. When the iPod first came out, Apple's reputation was still questionable in the consumer electronics market, and its computers were considered a niche.

What Apple did with their iPod and iPhone was to create an entire, controlled ecosystem that greatly simplified the use of digital music products, not just the device itself but from shopping to the ear. They did not create a superior product but a superior experience, addressing many of the concerns that prevented customers from adopting the technology. I hold great respect for iRiver products and thought that their MP3 players at the time were actually better products than first generation iPods, but those devices were not easy to use. It took a touch of tech savvy to figure out how to acquire MP3s, organize them, label them then upload them onto the devices. For your typical college student, young professional or techie it wasn't too hard, but for anyone outside those demographics, it was an intimidating process. Apple overturned that and made a system that's much easier to use. Their real advantage wasn't that they were simply an American brand but that they had made a somewhat complex process much, much easier. My own mother, deathly afraid of even turning on our computer at home, could handle her iPad with ease. It's not technologically the most advanced, but it was a real vision that expanded beyond simply the product and looked at the entire process of purchasing music.

Again, I agree with you that this constant emphasis on "creativity" is a bit misguided and that Korean firms have shown great creativity. The way Hyundai worked its way back into the United States automobile market shows an Apple-like spark, placing focus not simply on technical specs (although a critical component) but understanding the root of customer concerns and aggressively addressing them (100k mile powertrain warranty, recession car buyback). Also agree that engineering creativity is greatly underrated perhaps because people don't fully understand them until they see the technology applied.

I think you're really stretching and distorting the concept of creativity here if you think it's having creativity that causes Apple to not create many jobs. Apple's - typically corporate American - decision to go to Asia for supplying and manufacturing is really quite independent of the creativity it shows in product design.

You're also comparing apples and oranges when you pit Samsung or Hyundai's highly efficient and flexible manufacturing processes against Apple's slick product design. Not that the former's approach to manufacturing isn't creative - clearly it is - but it's a different field and a different type of creativity. We might ask: why does Apple excel at one type of creativity yet fail to apply their creative talent in the field of manufacturing? (Answer: they prefer to focus on what they do best and leave manufacturing to their partners). And people sometimes ask why Samsung doesn't excel as much in its product design as in other areas, particularly when it would in fact make more sense for them than for Apple to conquer another field, given their comprehensive, do-everything vision of themselves. Whatever the true reason may be, I suspect that it is *not* that they have chosen to focus their creativity in other areas.

The Korean's point about American cultural capital is well-taken. Innovative designs from other countries are disadvantaged simply by not being American. I would add that lack of access to global marketing and distribution channels - also dominated by America - is another big factor. Suppose Samsung had tried to launch cyworld internationally accessing those channels. Suppose it had adopted cyworld, then gone to various international telecoms and marketing firms, advertised on TV, put cyworld and cyworld characters on people's mobile phones, had cyworld sites in English and many other languages...? Could it have worked? Would it have been foredoomed to failure simply because it wasn't culturally American and therefore wasn't 'cool'?

We'll never know because they didn't try. Why not? Plenty of foreign products get rebranded and re-imaged for American use, so why not non-English websites? Did cyworld even try putting up an English version? Perhaps, now that creativity is such a buzzword in Korea, the rich talent in design that exists in Korea will get more respect and more attention from Korean business leaders; and perhaps a new, 'cool', globally aware generation will both understand what it takes to create a global trend and actively attempt it.

You just made me wonder if another reason why Korean designs haven't caught on is that the designers assume their customers aren't knuckle-dragging morons who can't figure out the controls (although simplicity in design is a virtue and computers, as Apple knows, shouldn't work like a half-finished product you're constantly having to find fixes for).

But are inept old people really the market Apple are going for? Surely their biggest success has been among the young?

Personally, I don't even like iPod and, lest we forget, Apple product users have (had?) a rep for douchebaggy pretentiousness.

@JoshMaking the blanket statement that Apple simply makes better products is just as much as a fallacy as the "creative" argument might be as it's based entirely on personal opinion.I 100% honestly, consider my (Samsung made) Nexus S to be overall superior to my wife's iPhone 4, but I know that opinion is probably only relevant to me.

I think the Cyworld thing could be explored further in another article. It really did pre-date MySpace and Facebook in terms of functionality, but their attempt at entering the US market was pretty weak.

I had Korean friends and family that frequently used Cyworld, but when I signed up to try the US version I was dismayed to find that the US instance of the service was entirely separate and walled-off.

(Not sure if the National ID number requirements to have a Korean Cyworld account were/are a legal/regulatory requirement or just a habit to keep foreigners out; not unlike some US-based websites that can only process US-based credit cards)

Cyworld DID try to go international, and failed because they didn't read their target audience correctly. Their biggest failings: 1. failing to simplify its interface so that it would work with lower internet speeds than Korea had. 2. limiting each nation's Cyworld branch to being able to connect only with Cyworld users from that nation -- in Facebook, I can "friend" an FB user in USA, Swaziland or Mongolia; Cyworld Mongolia users could only have connected with other Cyworld Mongolia users.

And by the time Cyworld started going international, Myspace was already huge, and Facebook was getting a toehold.

Josh: "better products" is so vague. Better in what respect? Apple products are way better for people who want a certain kind of experience from their product, but for people who like to tinker, Apple products are frustratingly un-tinker-able. I tell people I know, "If you like to tinker with your car to make it go faster, get a PC. If you want your car to work and not worry about it, get a Mac." Samsung products let me plug more devices into my phone/tab, insert extra memory into card slots, and they have more than one friggin' button for different functions. Apple is a great experience... as long as you're content having the exact same apple experience everyone else has, and have no interest in deviating from that standard.

Matt: I think that young people like Apple stuff because it looks cool, while older people like it because it's easier to figure out how it works. That Apple products appeal to style-conscious young people as well as older technophobes is certainly part of its success.

I think the word creativity is not necessarily the right description when talking about the type of products apple made. In a way because Apple products are so stylistic and slick people tend to call the company "creative" in that sense, but to me the "creativity" Apple had was really making game changing products that revolutionized whole industries. Apple in effect I think almost singlehandedly changed the way people consume digital media by making it mainstream and legal to buy music and video online and then played back universally on devices like the iPod and iPad. The iPhone also arguably completely changed our perception of what a smartphone is supposed to do. Such an achievement in "creativity" is hard to compare with being able to streamline manufacturing processes level of "creativity". As I have remarked in the past, Koreans do well innovating and improving along a conventional path, and do it well. They however have yet to really make quantum leaps in innovation that is comparable to game changing innovations seen made by other countries, most notably the US. tK's argument that the sort of creativity Korea has exhibited is actually fine economically, is true, but I do think is something that Korea would like to aspire to. But that kind of creativity needs to be nurtured and allowed to fail and make mistakes. The problem with Korea isn't the lack of creativity, it seems to be the lack of tolerance of failure. I just do not see much chance that a college dropout would go on to create a company out of their garage in Korea.The hard questions Koreans might have to ask themselves, is if a Korean Steve Jobs might have ever been allowed to reach his potential in Korea. Would people be allowed to make the mistakes Steve Jobs made and still be able to live the life Jobs did? Would a Korean Steve Jobs been able to make the risky choices he made? In the end I think Steve Jobs life is probably one that is very uniquely American. If Korea would like to foster people like Steves Jobs in Korea they are asking the right questions when they ask why they are not "creative".

Tremendously insightful and superbly written, as usual. I agree totally that US cultural hegemony places American products at a tremendous advantage over similar ones from other countries. Everyone raves about China, but who do the Chinese aspire to be like? As you say, the only country that promoted an altenative lifestyle was the Soviet Union, which was doomed as soon as most people around the world had chosen the American way of life.

A minor point: I don't quite agree with you on the specific areas where American products dominate. American cuisine is popular in many countries (think Mc Donald's or Pizza Hut), but then again most dishes that we think of as 'American' are adaptations of European ones (how many Native American recipies can you think of?) American cars are not generally well-regarded in Europe, where European and Japanese models are preferred, and even in America itself the most sought after brands are European (such as BMW, which you mention).

Probably the area where US cultural dominance is most complete is music, especially hip-hop (which, again, you mentioned). A perfect example was when I was talking to a New Zealander who loved American rappers but couldn't even name a single New Zealand one (yes, there are NZ rappers!) The British rap scene, although very "creative", receives hardly any attention outside the UK. Many British rock/pop acts are popular in the USA, and hence also popular worldwide, but in terms of preserving our cultural indentity the fact that we speak English is a double-edged sword. It makes it much easier for us to promote our music and literature to an American audience, but it also rops us of a natural barrier against Americanisation.

Korea lacks influence that America has in the software field. Samsung phones run Android which is Google's creation. Software products like Apple and Google are leading the market and hardware (where Korea is strong) won't be as influential or profitable. It's surprising that despite Korea being one of the most wired countries, that they fail to export software like Cyworld and are instead using sites like Google, Youtube, Twitter and Facebook. It's not about being creative, it's about being smart about product design and marketing.

How is it not a better product? Tech reviews and consumer reviews have dictated so, including in areas regarding customer service, the fact that it has its own OS, build quality, integration of all other components (media, Internet, etc.), overall execution, ease of use, the list can go on and on.

How is it not "tinkerable"? You can write your own apps, for crying out loud. You can change the physical appearance of it. And if you're talking about the silly stuff like fonts and all of that, you can jailbreak it if you want.

And you honestly cannot say that American hegemony is why Apple is so successful, especially in Korea. Not even a few years ago, people in many countries had no idea who Apple was. Americans didn't even know what Apple was at one point, or laughed at any mention of the company. Don't forget that Apple was totally in the crapper when they brought back Jobs in the late 90s.

Apple was able to remake the world's habits because it was able to execute. There were many American smart phones before with functions similar to iPhone, but they didn't set the world on fire the way Apple did with their release of their phone. And Korea surely wasn't going to be the one changing the world's habits, not because they weren't American, but maybe because they got into the smart phone game late, and their own people weren't even using the product that their companies were making.

And Korea surely wasn't going to be the one changing the world's habits, not because they weren't American, but maybe because they got into the smart phone game late, and their own people weren't even using the product that their companies were making.

It is a fair argument to say that Apple made better products than anyone else, but the statement above is just completely off the reservation. Korea got into the smart phone game late? WHAT? Before iPhone, Korean companies were completely owning the market for the most advanced phones. It was Apple that got into the smart phone business late.

SJ - "What Apple did with their iPod and iPhone was to create an entire, controlled ecosystem that greatly simplified the use of digital music products, not just the device itself but from shopping to the ear."

I agree. But please go back to my yPod example -- even if a different company made exactly the same product/service as iPod (i.e. the "yPod",) there is no way yPod would succeed like iPod did.

I do take your point about Sony. I might make an exception for Sony as a company that might have been succeeded in making a yPod, if only because Sony Music gave them the experience of dealing with American music market. But that only speaks further to the strength of America's soft power. Other non-American companies that lacked music market savvy that Sony had would have certainly failed with a yPod. (Recall that Apple did not have much music market presence at first.)

Matt - "I think you're really stretching and distorting the concept of creativity here if you think it's having creativity that causes Apple to not create many jobs."

I can see why you think that. I made a small edit in the OP to make the point clearer. Creativity itself does not cause Apple to generate fewer jobs. But the Apple-model of creativity -- i.e. deploying creativity in design and not in manufacturing -- does cause Apple to generate fewer jobs.

"You're also comparing apples and oranges when you pit Samsung or Hyundai's highly efficient and flexible manufacturing processes against Apple's slick product design. Not that the former's approach to manufacturing isn't creative - clearly it is - but it's a different field and a different type of creativity."

As you acknowledge, both the manufacturing process and product design require creativity -- just as much as apples and oranges are both fruits.

I always look forward to reading this blog. I'm always amazed that TK squeezes in enough time to write such thoughtful blog posts. I can barely piece together a coherent blog comment.

I agree with TK about Korean companies employing far more employees and their American counterparts. It's one of the huge issues for the American economy, the bleeding of manufacturing jobs. I fear that the trend is simply irreversible.

“Apple's creativity is wildly overrated.” Really? Respectfully, TK is wrong in his assessment of Apple. Apple is not a hardware manufacturing company. It's a software and design company. And an incredibly creative one at that. Many, many companies made MP3 players before Apple. In fact, when the iPod was first introduced the collective response was head scratching. Another MP3 player? How unoriginal. But then Apple created an elegant, easy to use interface, and an iTunes store where you could download music cheaply and simply. A stroke of genius.

There were smartphones before the iPhone. I used to carry a Windows Mobile phone (shudder). But when the iPhone debuted with a true touch screen with multi-touch gestures, and an app store, it was pure genius. Engineers all over Silicon Valley were kicking themselves wondering why they didn't think of these innovations.

The Samsung Galaxy S is a great cell phone. The hardware specifications of the Galaxy S are superior to the iPhone is almost every aspect. But it’s not fair to compare the two phones. Samsung is a hardware manufacturer (and a damn good one), but it doesn’t develop the operating system the phone runs on top of. They leverage Google’s Android OS. And the Android OS would not exist today (in its current format) had Apple not invented the iOS based iPhone.

Can you imagine what smartphones would look like today had the iPhone not been invented? We’d still be using styluses and tiny keyboards. The iPhone wasn’t just a creative master stroke, it was a technological revelation.

There were tablet computers years before the iPad. Microsoft has been trying to crack the tablet market for almost 10 years. But it was iPad and its innovations that created the market. The iPad didn't take over market share, it created market share. The Samsung Galaxy S Tab would not exist today had the iPad not been invented.

The assertion that Apple is successful because America is a superpower is a cop out. It does a disservice to both Korean and American ingenuity and entrepreneurial spirit. If TK’s assertion were true, companies like HP, GM, and eBay should be kicking butt everywhere. Needless to say that’s simply not the case.

Korea produces some really amazing products, and I’m impressed with how far Korea has come in such a short time. I'm proud to be Korean but I’m also a Californian, and I’m also proud of Apple. Everyone should aspire to the level of creativity Apple has shown. Whether you’re an American, Korean, or Azerbaijani company it’s a great goal to aspire to. On the back of every iPhone there’s an inscription that says, “Designed by Apple in California.” Damn straight.

It is a fair argument to say that Apple made better products than anyone else, but the statement above is just completely off the reservation. Korea got into the smart phone game late? WHAT? Before iPhone, Korean companies were completely owning the market for the most advanced phones. It was Apple that got into the smart phone business late.

This is simply not true. Korean companies might have been "owning the market" with phones that were not smart phones (i.e. regular handsets), but Samsung and LG did not start really making true smart phones until after the iPhone came out. The major names of the smart phone world before Apple introduced the iPhone were Palm, RIM, Sony Ericsson, Nokia, Windows, and Symbian.

And even after the iPhone made smart phones the status quo of cell-phones, the Korean market itself did not actually start introducing the REAL smart phones it was offering in other countries until AFTER the iPhone started infiltrating the Korean market. Anyone that has been living in Korea the past few years can tell you that.

Digirati: "The assertion that Apple is successful because America is a superpower is a cop out. It does a disservice to both Korean and American ingenuity and entrepreneurial spirit. If TK’s assertion were true, companies like HP, GM, and eBay should be kicking butt everywhere. Needless to say that’s simply not the case."

First of all, thanks for reading.

I think you are getting mixed up on that point, however. The point is not that all American companies will succeed like Apple. The point is that a non-American company X that exercises exactly the same amount of imagination, vision, creativity, etc. as Apple will still not be successful as Apple, because X is not American.

Josh: "This is simply not true. Korean companies might have been "owning the market" with phones that were not smart phones (i.e. regular handsets), but Samsung and LG did not start really making true smart phones until after the iPhone came out. The major names of the smart phone world before Apple introduced the iPhone were Palm, RIM, Sony Ericsson, Nokia, Windows, and Symbian.

This argument relies heavily on a muddled definition of "true smartphone". What is a "true smartphone"? Is it a phone that can also serve as a PDA? A phone that can send and receive emails? A phone with a camera, a touch screen? You have to be clear on what you are talking about before there can be a meaningful discussion.

This argument relies heavily on a muddled definition of "true smartphone". What is a "true smartphone"? Is it a phone that can also serve as a PDA? A phone that can send and receive emails? A phone with a camera, a touch screen? You have to be clear on what you are talking about before there can be a meaningful discussion.

I would say that the first two functionalities you suggested would be included, but not the latter of the three.

You can beat around the bush with regards to this issue, but simply put, Samsung and LG were not in that game. Anyone with general knowledge on tech and cell-phones would agree.

Putting my two cents in: 1. about a month ago my Sony Vaio crashed and I was forced to use my Macbook that was stored unused for over one year for the first time in my life. That was a hellish experience, let me tell you. It took me about two months to get my Sony fixed, and I am back to Windows for good. I am not saying Windows are better, but some people are just not made for Apple products.2. Ipad, Iphone, Android, Blackberry, Galaxy S, etc are all communication devices. Communication is a basic human need (both psychological and physiological)and it is not going to go away (this why this blog was created and this is why you post all your comments). Whoever comes up with a better communication device, be it Nokia or Mamboo-Yamboo is going to make mega bucks. My prediction: the next step is to create an all-in-one device, that would combine the opportunity to download books like Kindle, use it as a video phone like Skype and Iphone, play games and use applications like Ipad, watch TV, listen to Itunes, surf the Internet and post on Facebook is going to win. Plus, if this device is small and has a sleek and modern design - even better, more cash.3. On a personal note - I don't like how Korean phones are designed. Koreans have such a refine taste - what is wrong with their designs? Those phones look super ugly!!! Where is their innate feeling of beauty?4. Creativity comes with high dopamine levels in the brain. There are some natural ways to increase dopamine and some not natural ones. Not natural - drugs, sex and rock-and-roll. Natural - green tea, ginseng, gingko biloba, mushrooms, love, new adventure, travel, novelty. In my experience, Koreans are extremely creative, all they need is freedom to do whatever they want. They are too boxed in as a society and they need to relax a little when it comes to following Confucianism and other rules (just as in Taegeuk, the blue comes with the red). I know they can outsmart any smartphone and outfruit Apple.

Okay then. LG Chocolate was a phone that could serve as a PDA, as well as send and receive emails. It also came out in Korea in 2005. (For a good measure, it also had a camera and a touch screen.) Why is Chocolate not a smartphone, by your definition?

Okay then. LG Chocolate was a phone that could serve as a PDA, as well as send and receive emails. It also came out in Korea in 2005. (For a good measure, it also had a camera and a touch screen.) Why is Chocolate not a smartphone, by your definition?

I said that the 2 functionalities that you mentioned are included in the definition of a smartphone, not the only aspects of what makes a smartphone. I will try and dig up a clearer definition, along with reasons why phones like the Chocolate are not smartphones, to help the discussion of this issue after I wrap up my work for the day.

"although Korean economy generates cutting-edge technological products, it is not truly creative like Apple, led by Jobs, is"

Generates is a very mucky word here, because it muddles the difference between design and manufacture.

China manufactures everything in the freakin' world, but it doesn't design anything.

Manufacturing doesn't take creativity, it takes lots of capital. In Korea's case (as many other countries that have developed over the past 50 years, eg. Asian Tigers) that money came from the Government. Not Entrepreneurs.

The goal of the Economy or the Country is not, of course, to be Creative, or Innovative, but it is, to many Developmental Economists, to reach the SERVICE ECONOMY.

You can charge a lot more for a service, and society in a service Economy prospers because lots more people go to University, etc.

Korea, the US, England, etc should all strive for a service economy (yes, Plumbing and Dentistry are services.. it doesn't mean White Collar).

The problem with Korea (and China, etc)'s lack of creativity is, when you're unoriginal, you can be commoditized very easily. That means the company stops growing.

Lots of things are "generated" in Korea, but where were they designed? California of course.

Very insightful! Shared this so our fans could share their voice about the topic over on project Advanced Technology and Design Korea. Most of fans are android and samsung fans, so it was interesting to see their response. Drop by the facebook, blog and twitter for tons of related content and to see the reaction:) Have a good one and keep it up! (@advancedtechkr)

Okay then. LG Chocolate was a phone that could serve as a PDA, as well as send and receive emails. It also came out in Korea in 2005. (For a good measure, it also had a camera and a touch screen.) Why is Chocolate not a smartphone, by your definition?"

Sure, those are called feature phones, in part because they didn't have applications and app stores, and couldn't surf the real internet, but a WAPP version of the internet.

In other words, you're asking why Windows Mobile didn't get more respect as a Smartphone. It wasn't because it didn't have a centralized App Store and Desktop Quality apps (eg. like a computer in your pocket).

Another thing that Apple had going for it even when it was doing poorly in the mid-90s, was an extremely loyal group of Apple computer users who were just waiting for Apple to pull something awesome out of its hat, and more excited than anyone to spread word about it once they DID come up with something really cool.

@TheKorean " Creativity itself does not cause Apple to generate fewer jobs. But the Apple-model of creativity -- i.e. deploying creativity in design and not in manufacturing -- does cause Apple to generate fewer jobs."

Actually we could say it does create plenty of jobs in manufacturing - just not in its country of origin.

@HL "It's not about being creative, it's about being smart about product design and marketing."

Perhaps we can say it's partly about *not* being retarded? ;)

I'm tempted to say Samsung would not have known how to market the Smartphone effectively even if they'd invented it. It's an easy thing to get wrong, and would Samsung be willing to relinquish enough control over the process to let a partner company show them how? I don't have any evidence for this but a lot of people have said similar things.

Perhaps there's more to American cultural capital than simply the popularity of American culture. The PR/marketing industry in America (and Britain) is probably more highly developed than anywhere else. Until PR reaches that level of sophistication in Korea, their exercises in global brand creation will be handicapped.

"Service economies are dependent on manufacturing economies elsewhere and export jobs to those economies, which is one reason I prefer the German and Japanese models: do everything and do it well."

Agreed, these things are all interdependent, certainly, you can't get to the higher rungs of the ladder until you progress through low-level and high-level manufacture, and ultimately you never get to 100% employment in one 'sector', you'll just be more heavily weighted in one over the other.

Not everyone can (or should) be a Masters or Phd, which means having manufacturing in a place like Japan/Germany, means there are very good/respectable jobs available for those who don't (yet?) have higher degrees. While you're in School, get a part time job at the plant, upon graduation get an internship, it's a pretty good system.

Bear in mind, those factory jobs are not only shifting over to China, but even shifting OUT of China into even cheaper wage countries (because, alas, the factory wages in China are now, in some cases, too high to attract foreign companies). Next up, Burma, Vietnam, Malaysia, etc.

My point was that Korea, on the world stage, is viewed as a high end manufacturer of great cars and great electronics, but less so as a designer or innovator, or software maker. The former can, and will be commoditized, the latter cannot. That's all. Korea is doing very well, but of course things like RAM and 10 " LCD panels can be commoditized (eg. driving margins and prices down, thus associated employment gets squeezed out and disintermediated or replaced by a robot).

Creative Professionals and Industrial Designers are excellent examples of Service Economy professionals, among all the usual suspects (accountancy, legal, marketing professionals, etc).

AAK was suggesting that maybe Korea didn't have to be a Service economy (eg. creative professionals), I was just throwing my 20 Won in.

I think that many people still have the mistaken belief that creativity is in the sole domain of the US, which I definitely don't agree with. It's funny because Steve Jobs defines what creativity is in one of his quotes:

"Creativity is just connecting things. When you ask a creative person how they did something, they may feel a little guilty because they didn’t really do it, they just saw something. It seemed obvious to them after awhile. That’s because they were able to connect experiences they’ve had and synthesize new things. And the reason they were able to do that was that they’ve had more experiences or have thought more about their experiences than other people have."

Based on this the US will be more creative in certain areas (software, design) than Korea due to the fact that they have had more experience with it. On the flip side there are things that Korea has more creativity in such as shipbuilding.

Btw this video is pretty interesting. It tries to look at the issue of creativity and dispel the myths surrounding it.

I never knew why people gave apple so much credit for their product... They started with the ipod series at around 2001, at that point and time I've already used CD mp3 players, and flash base mp3 players atleast 2-3 years before (64MB flash player lol), nothing new, and the ipod system relying on Itune to sync is such a failed system.

Then comes the apple computers, so much failed in the super expensive system I don't know where to begin.

Then comes the iphone, Ok this was actually pretty dam good, I know nokia came out with smart phone much earlier but the iOS made the iphone pretty dam good....

But if you look at the whole picture they didn't really do anything, they had a good marketing strategy that get people "hooked" on to their products, and the majority of people who uses their product are more for "looks" than functionality.

Besides the iphone I would never touch any of their other products, they're absolutely horrible for the price tag, as an early electronic adoptor i never found apples to be innovated, they sure have the slick look but other than that, I can't say that they functioned as well as some other products on the market in the same categories.

The point is not that all American companies will succeed like Apple. The point is that a non-American company X that exercises exactly the same amount of imagination, vision, creativity, etc. as Apple will still not be successful as Apple, because X is not American.

Wow, this is a talky blog. Speaking as an American, it seems that Apple & Jobs were venerated for two things: creativity and marketing. American companies are not known for creativity - that's why Apple stood out, even among American companies. Plenty of other American companies could have done what Apple did - but they didn't precisely because they lacked Job's vision, drive, and marketing. Nokia - not American -certainly could have done it but didn't. And Sony, BMW, Mercedes Benz and non-American companies in other industries have succeeded around the world. Being American gives a head start - especially in marketing - but is no guarantee of success. And American corporations seem, to me anyway, quite fearful of creativity and newness in the marketplace. Let someone else take the risks and we will follow.

The creativity you point to behind the scenes in the shipbuilding industry is appreciated within that industry, I'm sure. These things get around, but by their very nature will never be widely acknowledged publicly the way consumer items are.

Finally, "economy" and "create wealth" or "culture" and "create higher standard of living"? Money we got, but that doesn't mean we have the highest standard of living.

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About TK

The Korean is a Korean American living in Washington D.C. / Northern Virginia. He lived in Seoul until he was 16, then moved to Los Angeles area. The Korean refers to himself in the third person because he thinks it sounds cool.